SHANGHAI — China’s pork prices surged again in August, as the government dips into national reserves to stabilize costs and ensure supply in the world’s biggest consuming nation of the meat.

The country’s headline consumer price index (CPI) slowed in August to 2.5%, according to official data Friday, while producer inflation eased to its lowest level in 18 months at 2.3% — far lower than in the U.S., U.K. and other nations battling decades-high inflation rates.

But the price of pork, a staple in China that is used in a wide variety of dishes, has bucked the trend by surging in recent months with average prices jumping 22.5% on-year in August after a 20.2% jump in July as output reductions squeezed supply.

Pork has the heaviest weighting among foodstuffs in China’s CPI.

The fresh data came after the government this week said it was dipping into frozen pork reserves for the first time this year in a bid to rein in prices as China gears up for this weekend’s Mid-Autumn Festival and National Day on Oct. 1.

But Chinese pork traders warned that the release of more frozen supply may not help much.

“Most of our customers prefer fresh pork to frozen pork,” said one seller in Shanghai. “Customers these days are buying less than before the lockdown in April because household incomes are flat and pork prices are rising,” he added, referring to a two-month COVID-19 lockdown in China’s financial capital earlier this year.

The government intervention was likely to ease supply concerns only in the short term, said Deng Shaorui, an analyst at Huatai Securities.

“Pork prices are going to stay at high levels,” Deng was quoted as saying by the Shenzhen Securities Times on Friday. “As the weather cooled and pork consumption recovered seasonally, demand is expected to grow ahead of the Mid-Autumn Festival and National Day holidays.”

By CK TAN / Nikkei Asia

Average pig production losses have topped £50 per head for the second successive quarter, as soaring costs continue to cripple an industry that has now lost more than £600 million since the autumn of 2020, according to AHDB estimates.

The latest AHDB quarterly cost of production and margin estimations for Q2 show producers lost, on average, £52/pig (58p/kg) in Q2, following losses of £58/pig in Q1 and £39/pig in Q4 2021, meaning producers have now endured seven successive quarters of negative margins.

While the average pig price rose rapidly, from 146p/kg in Q1 to 183p/kg in Q2, so did average costs, as the impact of the Ukraine war on cereal prices hit home. COP averaged 240p/kg over the quarter, up 33p on Q1, 58p on Q2 2021 and 85p on Q2 2020.

This was primarily driven by a further 27p hike in feed costs to 174p/kg, with labour, energy, fuel, interest rates and falling cull sow prices accounting for some of the other cost increases, with decreasing carcase weights also a factor.

The estimates use the latest performance figures for breeding and finishing herds for the 12 months ending June 30, 2022.

“With pig producers experiencing continued negative margins since October 2020, it is estimated (based on the total pig slaughter numbers) that the industry has lost over £600m since October 2020 to the end of June 2022,” AHDB analysts Carol Davis said.

Numerous producers have already been forced to quit, and many more have reduced their sow herds, as reflected in the June Defra Agricultural Survey, which shows a 17% year-on-year decline in the breeding herd. This is expected to result in a large shortage over the late-autumn and winter.

By Alistair Driver / Pig world

The Asian market has had a significant impact on the value of UK red meat exports in the first half of 2022. 

The latest data from HMRC shows that China remains the largest importer of UK pig meat, as export values reached nearly £88 million in the year to date. Furthermore, more than half of the 108,294 tonnes of UK pig meat exported to non-EU countries went to China, closely followed by the Philippines.

The Philippines has become the world’s third largest importer of UK pork, with the first six months of 2022 recording shipment values of £25.9m – an increase of 14.8% on figures for the same period last year.

Pig meat and beef shipments to Japan have also increased; pig meat shipments totalled nearly £3.2m, while beef exports have increased to £9.2m, from £2.8m, in the first six months of the year.

AHDB head of exports Jonathan Eckley said: “Asian markets continue to prove a hugely valuable market for the UK’s red meat sector, despite many challenges on the global stage this year. While volumes to some countries may be quite low, these markets are vital in addressing the issue of carcase balance and utilising cuts that are less popular here in the UK but attract significant value in the Far East.”

“We will continue to work with government and levy payers to open more new markets in the Far East and develop the region further, including attendance at trade shows to showcase the high-quality red meat we produce here in the UK.”

by Meghan Taylor / Pig World

Strict new controls restricting the movement of pork and pork products into Great Britain to help safeguard Britain’s pigs from the threat of African swine fever (ASF) have been announced today (Wednesday 31 August 2022).

African swine fever poses no risk to human health, but is a highly contagious disease for pigs and wild boar. In recent months it has been spreading in mainland Europe leading to the deaths of thousands of pigs and causing significant disruption to the meat trade. With no vaccine available, the disease poses a significant risk to our domestic pig herd and our long-term ability to export pork and other pork products around the globe.

The new control, which comes into force from Thursday 1 September 2022, will strengthen the requirements for bringing pork and pork products into Great Britain from the European Union (EU) and European Free Trade Association states. It will no longer be legal to bring pork or pork products weighing over two kilograms, unless they are produced to the EU’s commercial standards. This does not apply to commercial imports, which remain unaffected by the control.

This action comes following the publication of a new risk assessment, conducted by the Animal and Plant Health Agency, which recognises that the chance that the ASF virus may be brought into Great Britain stands at ‘medium risk’. It found that the most likely way the virus could be introduced to Great Britain is by a member of the public bringing pork or pork products back from an ASF-affected country. This measure will help limit possibly infected pig meat being brought into Great Britain through various means, such as in passengers’ luggage or in vehicles.

Biosecurity Minister Lord Richard Benyon said:

“An outbreak of African swine fever is one of the biggest threats our pig industry faces today. We are not complacent and this decisive and proportionate action will stop the entry of pork products that pose the greatest risk. It is essential we maintain the highest levels of biosecurity and all visitors to the UK will need to abide by these new regulations.”

UK’s Deputy Chief Veterinary Officer Richard Irvine said:

“If African swine fever ever reached the UK it would have a severe and damaging impact on our pigs and pig industry. A single outbreak of this highly infectious disease would also harm relations with our trading partners and threaten the livelihoods of thousands of our pig farmers.

“We are taking this action to limit the risk of disease spreading by banning people bringing in high-risk pork and pork products that could carry this virus until further notice. Everyone can do their bit to help stop animal diseases spreading to this country by simply not bringing pork and other meats onto our shores.”

Welsh Government Minister for Rural Affairs and North Wales, and Trefnydd, Lesley Griffiths said:

“African swine fever is a highly fatal viral disease which is a major threat to our pig industry. Although not present in the UK, it is spreading across Europe and this timely action is important in helping to prevent the disease reaching our shores. We continue to monitor the international situation very closely and review our disease control tools.”

Everyone can help to stop the spread of ASF to the UK by doing the following:

• If you are visiting non-EU countries, you must not bring any pork or pork products back to the UK.
• If you are visiting EU or EFTA countries (Switzerland, Norway, Iceland or Liechtenstein), you must not bring pork or pork products which are over 2kg unless they meet EU commercial production standards.
• Disposing of leftovers or food waste in secure bins that pigs or wildlife cannot access.
• Farmers, the public and members of the food industry should practice high biosecurity standards, including never feeding catering waste, kitchen scraps or meat products to pigs, which is illegal and can spread the disease.

The government continually monitors disease outbreaks around the world to assess whether there may be risks for the UK and takes action to limit the risk of the disease reaching our shores.

Gov.UK

The pig sector has urged UK retailers to follow Waitrose after it made a fresh pledge to pay farmers a fair price during the backlog crisis.

Waitrose said it would be extending its commitment to pay a ‘fair and sustainable’ minimum price for pork to all of its pig producers.

The pledge has been made as prices continue to plummet, alongside record costs of production and an on-farm backlog of approximately 200,000 pigs.

The sector has faced a range of challenges, including the loss of exports to the Chinese market for certain pig processors, global disruption to CO2 supplies, and crippling labour shortages.

Waitrose’s move extends its previous commitment announced in November 2021, which it agreed to review on a regular basis.

Announcing the price pledge, the retailer warned the pig sector was facing ‘the biggest crisis in a generation’, with ‘falling prices impacting financial sustainability’.

by FarmingUK

by FarmingUK

Farmers demonstrated outside a meeting in York on Thursday as industry representatives met with the Environment Department (Defra) about the problems facing the pig production sector.

The National Pig Association (NPA) said the backlog of pigs ready for processing, which are having to be held on farms because of a shortage of butchers, is now estimated at more than 200,000 animals.

The industry body said it knew of 35,000 healthy pigs which have been culled on farms as a result of the backlog, although this is likely to be an underestimate, and 40 independent producers have recently left the sector.

Producers are being hit by shortages in EU workers, caused by Brexit and the pandemic, to process their pigs and by high costs of feed for animals that are having to be kept on farms for longer before being sent to abattoirs.

As the NPA and National Farmers’ Union (NFU) held an emergency summit with Defra, attended by representatives from major retailers and pork processors, farmers warned the meeting was vital to the industry.

By Emily Beament / Evening Standard

The cloud of uncertainty hanging over the future of Scottish pig processing has been lifted following the purchase of Brechin abattoir by Browns Food Group.

The specialist pig slaughterhouse, which employs around 100 staff, has been owned by Quality Pork Ltd (QPL), in a close collaboration between the two farmer cooperatives, Scottish Pig Producers (SPP) and Scotlean, together with Pilgrim’s Pride UK.

However, Pilgrim’s, which has been the sole customer for the pigmeat processed at Brechin, gave notice last year that the arrangement was “unsustainable” following a downturn in the pig industry and the abattoir’s loss of a valuable Chinese export licence after an outbreak of Covid at the plant.

That licence has not been reinstated by China despite the plant getting the all-clear by public health authorities a few weeks after the outbreak, and it is generally believed this is related to ongoing political tensions between China and the UK.

In a statement Dumfriesshire-based Browns said: “This is an exciting new development for both companies which will ensure a promising future for Scottish pork while supporting the existing established markets.”

SPP chief executive Andy McGowan said the new arrangement would mean business as usual for Scottish pig farmers who are currently supplying the plant with around 4000 pigs per week.

“The announcement lifts the question marks surrounding the future of the site  and brings about simplicity,” he said.

By Nancy Nicolson / The Courier

The government has agreed to convene an emergency summit of the entire pig supply chain as the sector’s crisis deepens.

Defra farming minister Victoria Prentis today agreed to the joint National Pig Association (NPA) and NFU request for a roundtable event amid a worsening crisis.

It comes as the pig backlog is now estimated to be well in excess of 170,000 due to a lack of butchers in pork processing plants, as a result of the pandemic and Brexit.

Tens of thousands of healthy pigs have been culled on farms across the country by increasingly desperate producers who have run out of space.

NPA chairman Rob Mutimer and NFU president Minette Batters wrote to Defra last week, calling for it to “arrange a summit of the entire pig supply chain so that we can agree a plan to get these pigs off farms and onto people’s plates”.

Responding, Mrs Prentis agreed that “convening a roundtable bringing together producers, processors, and retailers to discuss the ongoing challenges faced by the sector would be helpful”. The date will be arranged ‘shortly’.

She acknowledged that recruitment of butchers via the temporary visa route, which closed to applications on 31 December, had ‘taken longer than initially expected’.

But she said that processors could still recruit butchers via the UK’s new points-based immigration system, which was introduced last month.

The Defra minister also acknowledged that uptake of both the Private Storage Aid (PSA)and Slaughter Incentive Payment (SIP) schemes had been lower than anticipated.

by Farming UK

Defra Secretary George Eustice has told a committee of MPs that the Government is ‘limited’ in what it can do to support pig producers during their time of crisis.

Instead, Mr Eustice put the onus very much on pork processors to do more to increase their throughput and reduce the backlog on farms, at one point appearing to suggest this should include paying farmers less to speed up the process of getting pigs through plants.

However, while he offered little prospect of any short-term Government help for the industry, Mr Eustice reiterated that Defra is looking to introduce new legislation in the future to ensure a more functional and fairer pig supply chain.

Mr Eustice was questioned on the pig crisis by Environment, Food and Rural Affairs (EFRA) Committee chairman Neil Parish and other MPs at the end of a long and wide-ranging session on Tuesday covering his and Defra’s work.

‘Sheer waste of food’

Mr Parish quoted a Yorkshire pig farmer, who had told him pigs are being culled on her farm ‘as we speak’, as the impact of pigs being held on farm for longer due to processing delays takes its toll. “There are animal welfare issues of this and it’s a sheer waste of food,” Mr Parish said, before asking the Defra Secretary what more could be done to get pigs ‘properly processed and the animal welfare issues solved’.

Mr Eustice acknowledged that the situation was ‘quite difficult’, but went on to explain how the industry’s ‘asks’ that the Government had delivered in its October support package had not been utilised by processors.

The ‘bespoke’ temporary visa scheme for pigs that was delivered despite being a departure from Government policy ‘hasn’t been used as much as we’d hoped’, he said. “There was a provision for about 800, but I think it will be in the low hundreds for the numbers that they actually bring in under that scheme.

“Some of the processors have used the skilled route to bring some butchers in from some areas, but they’ve not they’ve not been recruiting in the way we thought they might, given the labour shortage was one of the key issues they kept highlighting.

Alistair Driver / Pig World